Guide to Bankruptcy, Attorneys, and All Chapters including 7, 11, 13, and 12

Is bankruptcy the right answer?

There are those who believe that bankruptcy is an easy ticket out of debt. While on the surface it may appear to be a way out, it really is not the ideal situation. For starters having a bankruptcy appear on your credit report will be a blemish for 10 years. Many lenders and other companies like insurance carriers are unwilling to work with or provide credit to anyone who has filed bankruptcy. In addition, a consumer who files for bankruptcy protection is limited as to how often this can be done. If you manage to get yourself into financial difficulty soon after filing bankruptcy, you may in trouble since bankruptcy will not be an option again you can seek for a number of years.

Can a collection agency harass me if I filed bankruptcy?

Collection agencies don’t like bankruptcy. That means they won’t be able to get their money from you. When you are going through a bankruptcy, it is possible they may work even harder to contact you. Some may try using intimidation tactics or threaten lawsuits. Through bankruptcy you are entitled to a stay from most creditors. This means they are supposed to stop harassing you. If they continue to bother you contact your attorney for additional assistance. Keep in mind; however, that certain creditors may still contact you during bankruptcy proceedings. Student loans are one example since they are rarely discharged in the process.

Can I get a loan after I have filed bankruptcy?

Qualifying for a loan after you have filed for bankruptcy is difficult, but not impossible. It is important to reestablish your credit history and show that you intend to make good on debts you incur after a bankruptcy. While it may take awhile and could cost you more money, you can still get credit. A good first step is to take out a small secured loan. You may need to add a cosigner to the loan who has excellent credit. Some lenders will not work with you for two years after filing bankruptcy while others will approve a loan but charge a much higher interest rate. If you make all of you payments on time and pay off the loan, your credit rating will start to improve allowing you to get more credit as time goes by.

How can bankruptcy help me with my debts?

When you have exhausted all options to deal with your debts, you may need to consider filing for bankruptcy. One of the most common forms of bankruptcy protection sought by consumers is Chapter 13. Through this your unsecured debt is essentially reorganized and the court determines how much money each creditor will receive. During this process you may be able to keep assets by paying your debt rather than having it repossessed. Chapter 7 is the other common form of bankruptcy filing for consumers. The biggest difference is that many of your assets will be sold and the funds will be used to pay off your debts. If you have no assets, it is possible that your debts will be wiped out by the bankruptcy with no expectation that you pay your creditors.

Keep in mind that bankruptcy should really only be considered in extreme cases. Working with a debt counselor first is better for everyone in the long run since bankruptcy can hurt your credit for ten years before it will disappear from your credit report.

If I am going through a divorce will my spouses bankruptcy impact me?

During a divorce many couples find that it is difficult to make ends meet when they split up. This may leave one or more in a position where they feel bankruptcy is the only way out. Keep in mind that since many of the debts were acquired jointly both spouses may be liable for the debt even if only one is filing. The one who did not file for bankruptcy may get pulled into anyway. If you find yourself in this situation, work with your attorney to get through the process.